In Saudi Arabia, water desalination is a cornerstone of its national water management system, with output exceeding 10.7 million cubic metres (m³) per day, making it the world’s largest producer of desalinated water. At that scale, energy is no longer merely an operating cost – it is a key determinant of a project’s competitiveness, sustainability and commercial viability.

The evidence is already in the numbers. Jubail 3A independent water project (IWP) – the first Saudi desalination plant to integrate solar photovoltaic (PV) – achieved energy consumption below 2.9 kilowatt-hours a cubic metre (kWh/m³) and was named Desalination Plant of the Year 2023 by Global Water Intelligence. Solar integration was central to both achievements.

The kingdom’s water projects no longer treat solar PV systems as supplementary. Solar is now an integration directly into a water project design, reducing grid dependence and cutting operating cost structurally. Shuaibah 3 IWP and Rabigh 4 IWP are both in operation, with solar integration forming part of each project’s design.

The policy shift

Renewable integration in Saudi Arabia’s water sector has evolved from a developer-led initiative into a formal procurement requirement. The Saudi Green Initiative (SGI) targets net-zero emissions by 2060, with commitments to reduce carbon emissions by 278 million tonnes per year by 2030 and place 30% of the kingdom’s land and sea under environmental protection. Saudi Arabia’s energy programme targets a diversified energy mix by 2030, with renewable energy and natural gas each accounting for 50% of total electricity generation, reducing reliance on fossil fuels across all sectors, including water.

SHARAKAT, the principal water off-taker of the kingdom, has introduced contractual energy-cap clauses and solar energy requirements into bid design. Operating in alignment with Saudi Water Authority’s (SWA) guidelines, all projects must support the national vision for sustainable water management. That alignment is now written into concession terms.

The scale of what is being addressed is measurable. In 2024, SHARAKAT’s portfolio consumed a total of 2.95 billion kWh of electricity – generating 1.62 million metric tonnes of carbon dioxide. These are Scope 2 emissions – the carbon produced at the power station to generate the electricity an organisation consumes, which is attributed back to the consumer. That is the energy footprint the water sector in the kingdom is working to reduce. It is also the cost baseline that renewable integration is designed to lower.

Each plant in SHARAKAT’s portfolio is assigned tailored energy targets based on its operational profile. For wastewater treatment plants, biogas capture technologies further reduce carbon emissions by converting a byproduct of the treatment process into an energy source, thereby reducing the carbon footprint of operations. 

What it looks like in practice

The shift from policy to project is visible across SHARAKAT’s IWP portfolio.

Jubail 3A IWP was the first desalination plant in Saudi Arabia to integrate solar PV panels installed as part of the project to generate electricity directly for the plant, reducing reliance on the national grid. The 600,000m³ reverse osmosis plant integrated a 45.5MW solar system, supplying 20% of the plant’s total energy needs and offsetting approximately 60,000 tonnes of carbon emissions annually. Commissioned in a record 27 months, it set a new global benchmark of energy consumption below 2.9 kWh/m³.

At $0.41/m³, one of the lowest water tariffs globally at the time of financial close, Jubail 3A IWP set the commercial benchmark that the projects following it are now measured against. Jubail 3B IWP built on that foundation. A 61MW solar system, the largest captive solar capability of any desalination plant in the kingdom at time of award, now supplies up to 20% of the plant’s total energy consumption.

Shuaibah 3 IWP extends it further. Developed by an Acwa Power-led consortium – Acwa Power Holding alongside the Water & Electricity Holding Company, the 600,000m³-a-day plant reached commercial operations in May 2025. It is the first plant to convert from multi-stage flash thermal desalination to seawater reverse osmosis technology in the kingdom. This is a shift that reduces baseline energy consumption significantly before solar is factored in. A captive 65MWp solar PV system provides part of the plant’s power requirement directly, reducing grid dependence and carbon intensity of operations.

Green finance and the water sector

Renewable integration changes the bid economics before anything else. The lower energy cost means lower operational expenditure. And in a tariff-competitive market, that flows directly into the unit cost of water production. Jubail 3A IWP set the benchmark, and solar integration was part of how it got there.

The financing argument follows the same logic. SHARAKAT’s portfolio achieved annual carbon savings of around 10 million tonnes through advanced technologies and operational efficiency improvements across its projects. Going beyond a sustainability footnote in their projects, it is a commitment in action. Plans to implement an environmental management system aligned with ISO 14001 mean that environmental performance will be governed, auditable, and reportable to lenders – not just claimed.

SHARAKAT has already signalled its intention to explore green bond financing for future projects. Recognised as the Best Water Company in Advancing Sustainability 2025 by ESG Mena, SHARAKAT’s projects are structured around availability-based payments with energy-efficiency measures increasingly embedded to strengthen the environmental, social and governance (ESG) commitment across the portfolio.

SHARAKAT and VCM formalise carbon credit partnership

As Saudi Arabia accelerates its journey toward a low-carbon economy, SHARAKAT is exploring opportunities to leverage the kingdom’s Voluntary Carbon Market (VCM) to maximise the value of emissions reductions achieved across its water public-private partnership (PPP) portfolio. Through renewable energy integration, energy-efficiency improvements and the adoption of low-carbon technologies, SHARAKAT is assessing pathways to quantify and certify eligible carbon reductions and unlock the potential of carbon credits.

The recently signed memorandum of understanding with VCM supports the kingdom’s sustainability and climate objectives, contributes to the development of Saudi Arabia’s carbon market ecosystem and reinforces SHARAKAT’s role in advancing innovative infrastructure solutions that support the national ambition of achieving net-zero emissions by 2060.

Renewable energy integration is becoming a standard feature of Saudi water PPPs with solar assets already integrated in key desalination projects and future financing options progressively aligned with green finance principles. The question for developers is not whether their project will require it, but whether their current capability is ready for the projects already in procurement.